BLOG: When it makes sense to become a cloud provider

Although most companies shouldn't consider becoming public cloud providers, it makes good sense in certain situations

These days, many enterprises have processes or data they want to share with the world — and they want to do it with cloud computing. At least, that's what I find in my travels.

The reasons vary, but some emerging patterns are pushing enterprises to become, in essence, small public cloud providers. The patterns include:

The need to provide information to outside parties using well-defined and secure interfaces. For example, the company wants to allow its partners or customers to see the status of an inventory item, or perhaps the company wants to provide complex data analytics services.

The need to define access to core business processes to outside partners or customers. For example, a company might want the ability to expose small tactical processes, such as purchase and shipment of products, using cloud-delivered APIs.

The need to provide access to complete enterprise applications. For example, the company wants to provide SaaS-based delivery of inventory-control applications so that partners and customers can check on inventory status and pricing.

When standing up these types of services, you should first understand that becoming a cloud provider is much more than just exposing APIs and browser interfaces. You will need to deal with security, governance, management, provisioning, use-based accounting, and tenant management, to name just a few requirements. It is a costly and risky process to stand up such services unless you know exactly what you're doing.

However, it's getting easier. There are cloud infrastructures that essentially come in a box that allow enterprises to become cloud providers right out of their existing data centers — take a look at most of the OpenStack distributions that have hit the market in the last few years, for example. This means you don't have to start from scratch when building a cloud.

Moreover, there are public cloud providers that provide on-demand cloud infrastructure so that you can build a public cloud, if you're willing to move in that direction. Many smaller public cloud providers build their offerings in Amazon Web Services, Microsoft Azure, and Google Compute Engine. They are public clouds within public clouds. You could do the same.

If it makes sense for your company to provide cloud services, you now can actually do so.